9M 14 Results presentation November 12, 2014 9M 14 - Highlights - - PowerPoint PPT Presentation

9M ’14 Results presentation

November 12, 2014

9M ’14 - Highlights

• Negative market trend in Europe in the ICC&R business.
• Sales increase in both ICC&R and Radiators.
• EBITDA increase in both ICC&R and Radiators.
• Net Result significant increase.
• Positive Cash flow despite Equity investment in ICC&R.
• Radiators turnaround is on track.
• RC Group (ICC&R) acquires Aircotech (consolidation in Q4).
• Dividend Policy

1

The figures reported in the present document, including some percentage values, were rounded to the nearest Euro. Therefore, some totals in the tables may not coincide with the sum of constituent amounts. All 2013 data are reported. For comparison purposes 2013 figures have been restated according to the JV in China shareholders agreements amendments and IFRS 11 requirements.

9M ‘14 Sales breakdown and mix by Business Line

Sales breakdown by business line Sales mix by business line

€M

9M ‘14 9M ‘13 Δ% ICC&R 249,4 237,6 5,0%

% total

9M ‘14 9M ‘13 Δ% ICC&R 84,0% 84,2%

• 0,2 pp

2

Sales increase in both ICC&R and Radiators. ICC&R 249,4 237,6 5,0% Radiators 47,4 44,5 6,6% Total 296,8 282,1 5,2% ICC&R 84,0% 84,2%

• 0,2 pp

Radiators 16,0% 15,8% +0,2 pp Total 100,0% 100,0%

• Overall increase.
• Europe slight increase with

growth in South and North; West stable and East

9M ’14 ICC&R Sales Trend by Geography - Change % vs. 9M ‘13

€M €M

9M ‘14 % tot 9M ‘13 % tot Δ% Europe

158,0 63,3% 156,5 65,8% 0,9% West stable and East decrease.

• Asia and ROW significant

increase.

3

Asia

78,8 31,6% 69,2 29,2% 13,9%

RoW

12,6 5,1% 11,9 5,0% 5,4%

Total

249,4 100,0% 237,6 100,0% 4,9%

9M ‘14 EBITDA by business

€M

Q3 '14 Q3 '13 Δ% 9M '14 9M '13 Δ% ICC&R 13,8 11,9 16,4% 34,7 32,7 5,9%

% on sales 15,8% 14,7% +1,1 pp 13,9% 13,8% +0,1 pp

Radiators 1,7 1,0 68,1% 0,3 (1,5) n.a.%

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Radiators 1,7 1,0 68,1% 0,3 (1,5) n.a.%

% on sales 9,0% 5,3% +3,7 pp 0,7% (3,4%) +4,2 pp

Corporate & elimination (0,8) (1,3) n.a.% (2,8) (2,8)

• % on sales

n.a.% n.a.%

• n.a.%

n.a.%

• Consolidated

14,7 11,6 26,6% 32,2 28,4 13,3%

% on sales 13,8% 11,6% +2,2 pp 10,8% 10,1% +0,7 pp

€M

9M ’14 Consolidated Income Statement

9M '14 9M '13 ∆% 9M '13 impairment Net Sales 296,8 282,1 5,2% 282,1 Gross Margin 105,3 100,4 4,9% 100,4

% on sales 35,5% 35,6%

• 0,1 pp

35,6%

EBITDA 32,2 28,4 13,3% 28,4

5

% on sales 10,8% 10,1% +0,7 pp 10,1%

Impairment (0,1)

• n.a.%

(21,5)

% on sales n.a.%

• n.a.%

(7,6%)

EBIT 24,1 20,7 16,1% (0,8)

% on sales 8,1% 7,3% +0,8 pp (0,3%)

Group Net Result 12,0 10,4 15,5% (11,1)

% on sales 4,0% 3,7% +0,3 pp (3,9%)

EPS – Euro cents 8,0 7,0 15,5% (7,4)

9M '14 Net Working Capital trend

€M

• NOWC as

percentage of

Sep '14 Dec '13 Sep '13 ∆ Dec '14/’13 ∆ Sep '14/’13 Trade Receivables 85,4 75,4 78,3 10,0 7,1

% on 12 months rolling sales

21,2% 19,4% 19,5% +1,8 pp +1,7 pp Inventory 57,5 46,4 58,2 11,1 (0,7)

% on 12 months rolling sales

14,3% 11,9% 14,5% +2,4 pp

• 0,2 pp

Trade Payables (98,8) (91,6) (98,3) (7,2) (0,5)

% on 12 months rolling sales

(24,5%) (23,6%) (24,5%)

• 0,9 pp
• 6

percentage of revenues increase.

Net Operating Working Capital 44,2 30,2 38,1 14,0 6,1

% on 12 months rolling sales

11,0% 7,8% 9,5% +3,2 pp +1,5 pp Other short term assets / liabilities (22,6) (17,7) (20,7) (4,9) (1,9)

% on 12 months rolling sales

(5,6%) (4,5%) (5,2%)

• 1,1 pp
• 0,4 pp

Net Working Capital 21,6 12,6 17,4 9,0 4,2

% on 12 months rolling sales

5,4% 3,2% 4,3% +2,2 pp +1,1 pp

€M

Sep ‘14 Consolidated Balance Sheet

Sep ‘14 Sep ‘13 Sep ‘14 Sep ‘13 Net operating fixed assets 248,9 250,0 Net Debt 2,7 13,9 Trade receivables 85,4 78,3 Group Equity 257,4 243,7 Inventories 57,5 58,2 Minorities 27,5 25,9 Trade payables (98,8) (98,3) Shareholders’ 284,9 269,6

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Trade payables (98,8) (98,3) Equity 284,9 269,6 Short term assets & liabilities (22,6) (20,7) Net Working Capital 21,6 17,4 Net financial assets 16,9 16,1 Net Capital Employed 287,5 283,5 Total Sources 287,5 283,5

Consolidated Cash Flow as of 9M

€M Q3 '14 Q3'13 9M ’14 9M ‘13 Net Debt beginning of period 6,0 20,0 7,0 17,3 EBITDA (A) 14,7 11,6 32,2 28,4 Taxes paid in the period (B) (2,3) (5,4) (4,2) (5,9) Change in provisions (C ) (0,2) 0,4 (0,1) 0,5 Change in working capital (D1) (7,0) 2,0 (11,6) 0,2 Adeo effect (D2)

• 0,9
• (11,5)

Investment activities (E) (2,9) (1,9) (7,6) (5,2)

8

9M ‘14 Cash flow includes the acquisition of the UK distributor in ICC&R.

Investment activities (E) (2,9) (1,9) (7,6) (5,2) Operating Cash Flow (A+B+C+D1+D2+E =F) 2,2 7,6 8,8 6,6 Equity investment (G) (0,3)

• (3,9)
• Changes in net equity and financial activities (H)

1,4 (1,5) (0,5) (3,2) Cash Flow for the period (F+G+H) reported 3,4 6,0 4,3 3,4 Net Debt end of period 2,7 13,9 2,7 13,9 Adeo blocked receivables (I)

• (0,9)
• 11,5

Cash Flow for the period rectified (F+G+H+I) 3,4 5,1 4,3 14,9

Net Debt Breakdown as of September ’14

€M Sep ‘14 Dec ‘13 Sep ‘13 Net financial position (2,7) (7,0) (13,9)

• f which:

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• f which:
• positions with bank and other financial

payables 2,3 (3,9) (9,8)

• fair value of derivative financial

instruments and options/payables for investments (4,9) (3,1) (4,1)

Important information

RC Group (DeLclima), a leading manufacturer with more than 50 years of experience and leadership in IT cooling and air-conditioning solutions, acquires Aircotech, that has been RC Group's exclusive distributor in Belgium, France and Luxembourg for many years. Aircotech promotes RC Group solutions in offices, hotels, hospitals, and retail buildings, as well as in datacenters, telecommunications and process cooling projects. Its success is based on the capability to offer full support to its customers, from the design stage, helping to identify the best energy saving solutions, to sales, commissioning, service and maintenance.

RC Group (ICC&R) acquires Aircotech

energy saving solutions, to sales, commissioning, service and maintenance. The acquisition of Aircotech is consistent with RC Group's strategy to develop a more aggressive and dynamic approach to export sales, by investing in existing partnerships and progressively acquiring its strongest distributors. This approach reflects DeLclima's strategy to strengthen its operating companies by establishing their direct presence in all core markets. This acquisition, by strengthening RC Group's presence in a key area particularly relevant for IT applications, enables RC Group to further improve its market share and margins.

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Important information DeLclima aims at granting a stable and significant dividend payment stream for its shareholders while providing increased long term value for their investment . In the absence of exceptional events, the Board of Directors will propose to the yearly Shareholders’ Meeting the distribution as a dividend of between 30.0% and 50.0% of Annual Profits, which is compatible with ensuring growth potential also through

Dividend policy

external lines, maintaining an appropriate and safe debt ratio.

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Relevant Projects Q3 ‘14 - CLIMAVENETA

Application: Process cooling - Automotive End user name: Volkswagen Plant type: Hydronic System Total installed Cooling capacity: 4.180kW Installed equipment: 4x TECS2-W/H 1053

VOLKSWAGEN EMDEN GERMANY

Volkswagen aims to achieve a CO2-neutral status for its production processes by implementing a multitude of projects on environmental protection and sustainability. Emden production plant is an example of this commitment, with 400.000 m2 "energy forest“ planted across a previously unused area of the plant and a 3000 m2 photovoltaic plant on the roof of Hall 10 generating

12 TECS2-W High efficiency water source chiller

the plant and a 3000 m2 photovoltaic plant on the roof of Hall 10 generating 350 megawatt hours of power every year. To achieve this quite ambitious sustainability target, four DeLclima high efficiency TECS2-W/H 1053 chillers have been installed to provide controlled process in the new bodywork production plant with the highest efficiency. Volkswagen has been using Climaveneta equipment in several of its plants across the world, for superior efficiency and reliability in their operations.

Relevant Projects Q3 ‘14 - CLIMAVENETA

BLOOMBERG PLACE LONDON GREAT BRITAIN

Application: Comfort - Mixed-Use Development End user name: Bloomberg Plant type: Hydronic System Total installed Cooling capacity: 7.796 kW Installed equipment: 4x TECS2-W 1954 The Bloomberg Place will include some retail units at ground floor level, and a new entrance to the London Underground, Bank Station. Bloomberg Place London will also host a permanent public exhibition of the Temple of Mithras which was originally uncovered in Walbrook in the 1950s. The construction project will be developed in three steps. The first one includes

13 TECS2-W High efficiency water source chiller

construction project will be developed in three steps. The first one includes the North Building where four DeLclima TECS2-W/LC 1954 units have just been installed, the second one will complete the North Building with the installation of four TECS2/XL-CA 0552 units expected in March 2015, and the last one is dedicated to the erection of the South Building, where three TECS2/XL-CA 1054 units will be delivered in November 2015. TECS units are the market leader in UK for unrivaled energy efficiency.

Relevant Projects Q3 ‘14 - CLIMAVENETA

Application: Comfort - Offices End user name: AB Medica Plant type: Hydronic System Total installed Cooling capacity: 1.250kW Total installed Heating capacity: 1.144kW Installed equipment: 1x ERACS2-WQ 3202 S 1x ERACS2-Q 1762 XL-CA-E-S 1x ClimaPRO

ITALIAN HQ MILAN ITALY

AB Medica is a specialised company in the production and marketing of medical technology, bio-materials, surgical devices and robotic surgery

• equipment. Its new

Italian headquarters is an iconic building, representing the value of excellence as well as innovation but is also strongly contemporary with great attention to the energy efficiency , environment and to the well being in the workplace. Two DeLclima INTEGRA heat pumps have been installed, one ERACS2-WQ 3202 S and one ERACS2-Q 1762 XL-CA-E. The plant is managed by ClimaPRO, the innovative plant

14 ClimaPRO Chiller Plant Control with Active Optimization System ERACS2-Q Air cooled multipurpose unit for 4-pipe systems with screw compressors

ERACS2-WQ Water cooled multipurpose unit for 4-pipe systems with screw compressors

1762 XL-CA-E. The plant is managed by ClimaPRO, the innovative plant room optimisation system designed to minimise overall energy consumption and to simplify the operation and maintenance of the central heating and cooling system. Focus: zero CO2 emissions at site, extensive use of renewable energies maximum yearly energy efficiency. .

Relevant Project Q3 ‘14 – RC GROUP

Application: IT cooling – Data Center End user name: Engineering, Pont Saint Martin (Italy) Plant type: Data Center Total installed Cooling capacity: 2MW Installed equipment:

• nr. 40 x direct expansion close control air

conditioners;

• nr. 80 x remote air cooled condensers.

Pont Saint Martin ITALY

Engineering, founded in 1980, is leader in software and IT services in Italy. It employs 7300 IT specialist and has 40 sites distributed in Italy as well as in Belgium, Republic of Serbia, South America and United States. The Pont Saint Martin Data Center, with a net surface of 2.700m2, is part of an Italian Network of 5 Data

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NEXT DX U Direct expansion close control air conditioners equipped with scroll compressors with downflow air delivery TEAM MATE Remote air cooled condensers

a net surface of 2.700m2, is part of an Italian Network of 5 Data Centers. Focus: Precision control of temerature and humidity, high reliability, Solution: NEXT DX U, TEAM MATE.

Relevant Project Q3 ‘14 – RC GROUP

Application: IT cooling – Data Center End user name: SFR, Champlan (France) Plant type: Data Center Total installed Cooling capacity: 1MW Installed equipment:

• nr. 12 x direct expansion close control air

conditioners;

• nr. 22 x remote air cooled condensers.

Founded in 1987, SFR is the second largest telecommunications

• perator in France with 9000 employees, 21 million mobile

customers and nearly 800 shops on the French territory.

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NEXT DX Direct expansion close control air conditioners equipped with scroll compressors with downflow air delivery TEAM MATE Remote air cooled condensers

Focus: Precise humidity and temperature control, high reliability. Solution: NEXT DX, TEAM MATE.

Relevant Project Q3 ‘14 – RC GROUP

Application: IT cooling – Data Center End user name: Wind Data Center, Ivrea (Italy) Plant type: Data Center Total installed Cooling capacity: 1,5MW Installed equipment:

• nr. 3 x air cooled liquid chillers in “A” class energy

efficiency. Wind is the third leading mobile operator in Italy. Since 2011 it is part of the VimpelCom Group, one of the largest mobile TLC operator in the World, offering voice and data service to 220 million mobile customers. Wind has been using RC Group IT cooling solutions in many sites across its network of data centers, for their superior efficiency and reliability. Ivrea Data Center benefits from greener energy efficient operation with

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GLIDER EVO CLA Packaged air cooled liquid chillers in “A” class energy efficiency equipped with screw compressors and axial fans.

Ivrea Data Center benefits from greener energy efficient operation with a savings up to 20% in power consumption. Focus: high energy savings, “A” class energy efficiency, high reliability, low noise. Solution: GLIDER EVO CLA.

New Products Q3 ‘14 - CLIMAVENETA

FOCS3-W

Chiller, water source 188 – 1.693 kW

High Efficiency

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Adaptability Maximum Compactness

.

New Products Q3 ‘14 - CLIMAVENETA

i-KI MTD 0075÷015

Air cooled heat pump only heating 20,4-38,1 KW

Extended Capacity Range System Efficiency

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System Efficiency High Efficiency at partial loads High Efficiency components Extensive operating limits

New Products Q3 ‘14 - CLIMAVENETA

Extended Capacity Range System Efficiency

i-KIR MTD 0075÷015

Air cooled reversible heat pump 15,6-30,5 KW

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System Efficiency High Efficiency at partial loads High Efficiency components Extensive operating limits

High Energy Efficiency Plug & Play Approach

New Products Q3 ‘14 - CLIMAVENETA

WTA

Autonomous fresh air unit 13,2 – 76,3kW

Plug & Play Approach Highly precise Continuous Regulation Plant Simplification

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New products Q3 ’14 – RC GROUP

Close control air conditioners with upflow or downflow air delivery, equipped with built-in water cooled condenser and BLDC inverter scroll compressors. 6,3 ÷ 119,0 kW

NEXT EVO INV DW Over version NEXT EVO INV DW Under version

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New products Q3 ’14 – RC GROUP

Sequencer for liquid chillers, heat pumps and multifunction unit.

MASTER PLANT SEQUENCER

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AHR MEXICO Sept 23-25, 2014 Mexico City DOMOTECNICA Sept 17-20, 2014 Turin DCD CONVERGED Sept 23, 2014 Bogotá

Exhibitions and Events Q3 ‘14 - CLIMAVENETA

EXPO FRIO CALOR Sept 3-5, 2014 Buenos Aires

Domotecnica September 17-20, Turin, Italy

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Important information

Disclaimer This document has been prepared in accordance with Italian law and may not be distributed, either directly or indirectly, in any other jurisdiction, in particular Australia, Japan, Canada or the United States of America or other country in which issue of the securities described in this document and the communication of the same are not permitted without specific authorization from the relevant authorities. Distribution of this document in any jurisdiction outside of Italy may be subject to specific regulatory requirements and

• restrictions. Any person coming into possession of this document should inform themselves of and comply with any such regulatory requirements or restrictions. The securities

referred to in this presentation are to be issued in relation to the demerger described herein and have not been, nor is it intended that they will be, registered pursuant to the United States Securities Act of 1933. Consequently, they may not be offered or sold, either directly or indirectly, in the United States of America except by special exemption. No representation or warranty, express or implied, is or will be made in relation to, and no responsibility is or will be accepted by DeLclima S.p.A. and/or by any companies controlled directly or indirectly DeLclima S.p.A.., nor by any of their respective directors, managers, officials, clerical staff, agents or consultants, as to the accuracy or completeness of the information contained in this presentation. No part of this presentation constitutes, or shall be taken to constitute, an invitation or inducement to invest in DeLclima S.p.A. in any jurisdiction in which registration or qualification of such securities is required under applicable law. DeLclima S.p.A. in any jurisdiction in which registration or qualification of such securities is required under applicable law. Forward-Looking Statements This document contains certain forward-looking statements relating to DeLclima S.p.A.. These statements are not historical fact and are based on current estimates and projections made: (i) by the companies party to the demerger concerning future events and, (ii) by third companies not belonging to the DeLclima group; by their nature, are subject to inherent risks and uncertainties. They relate to events and depend on circumstances that may or may not occur or exist in the future, and, as such, undue reliance should not be placed on them. Actual results may differ materially from those expressed in such statements as a result of a variety of factors, such as: volatility of commodity prices, changes in general economic conditions, economic growth and other changes in business conditions, changes in government regulation (in Italy or abroad), and many

• ther factors, most of which are outside of the control of the companies party to the demerger.